Betting big: Cement makers upbeat on Q2 sales growth
Expecting betting 2nd half of FY26 thanks to govt's spending on key infra projects and demand from housing sector
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New Delhi: Leading cement companies, buoyed by a high single-digit volume growth in the July-September quarter along with an increased sales realisation, expect a better performance in the second half of the current fiscal, betting big on the housing sector and the government's spending on key infra projects.
Top five cement makers such as UltraTech, Ambuja Cement, Shree Cement, Dalmia Bharat and Nuvoco Vistas have reported up to 18 per cent growth in their revenue from operations in the second quarter ended September, backed by healthy sales realisations, benign costs and premiumisation.
As prices of coal have declined and that of diesel stable on a year-to-year basis, even though the rate of petcoke increased, cement companies in their latest earnings calls said they expect a better performance in the second half (H2) of FY26, to be led by the individual home builders (IHB) segment in rural and urban areas, helped by factors such as a good monsoon and recent tax incentives and GST reforms by the government.
UltraTech, which has seen about 13 per cent growth in rural markets, expects the IHB segment to continue to drive demand, and it is seeing continuous announcements of new infrastructure projects, which will help the overall demand sentiment.
"The housing sector would be the key driver for the growth, and particularly the rural housing, demand has been good, and with the good monsoon actually this year and the revision in the MSP price and kind of thing, I think rural India is likely to dovery well," Managing Director Kailash C Jhanwar had said during the company's earnings call.
On the urban side, the company said that with the change in GST rates, personal income tax rates, and softening of interest, there are good green shoots and the urban demand is also likely to move further.
In the September quarter, UltraTech's consolidated sales volumes were up 6.9 per cent to 33.85 metric tonnes. The all-India average cement price increased by 2 per cent YoY in September 2025 to Rs341 per 50-kg bag. "In H1 FY2026, the prices were up 6 per cent YoY atRs 346/bag, while it declined by 3 per cent on a QoQ basis on account of monsoons and festive disruptions. In FY2025, cement prices declined by 7 per cent YoY to Rs 338/bag," according to an ICRA report.
In October this year, coal prices declined by 17 per cent YoY to $108/MT, and petcoke prices increased by 18 per cent YoY at Rs12,000/MT. Diesel prices were stable at Rs88/litre on a YoY basis.
"In 7M FY2026, coal prices were lower by 12 per cent YoY, while petcoke prices increased by 3 per cent. Diesel prices remained stable on a YoY basis," said ICRA, expecting "cement volumes to grow by 6-7 per cent YoY to 480-485 million MT in FY2026, backed by sustained demand from the housing and infrastructure sectors."
